TVA

Business Context and Reporting Period

Company: Texas Ventures Acquisition III Corp (TVA), a Cayman Islands exempted company and Special Purpose Acquisition Company (SPAC).

Reporting Period: Quarterly period ended September 30, 2025 (Q3 2025).

Status: The Company consummated its Initial Public Offering (IPO) on April 24, 2025, raising $225 million. On September 18, 2025, the Company executed a Purchase Agreement transferring sponsorship from TV Partners III, LLC ("Prior Sponsor") to Yorkville Acquisition Sponsor II, LLC ("New Sponsor"), accompanied by a complete change in the Board of Directors and management team. The Company is currently searching for a target business to acquire within an 18-month combination period (extendable).

Key Financial Metrics

Note: The Company has no operating revenue. Net income/loss is driven by interest income on the Trust Account and fair value adjustments to warrant liabilities.

Material Changes vs. Prior Period

• Sponsorship Transition: On September 18, 2025, the Prior Sponsor sold 7,500,000 Class B Founder Shares and 4,700,000 Private Placement Warrants to the New Sponsor for $7.4 million. The Prior Board and officers resigned, replaced by the New Sponsor's designees.
• Warrant Liability Volatility: The Company recorded a loss of $3.47 million in Q3 2025 due to the change in fair value of warrant liabilities (specifically NMSI warrants), compared to a gain of $2.03 million for the nine-month period. This volatility significantly impacts net income.
• Trust Account Growth: The Trust Account balance increased to approximately $230.2 million (from $226.1 million at IPO) due to interest income earned on U.S. government securities ($2.38 million in Q3).
• Share Forfeiture: Following the partial exercise of the underwriters' over-allotment option, 166,667 Founder Shares were forfeited and cancelled in April 2025.

Guidance, Outlook, Risks, and Contingencies

• Going Concern: Management has raised substantial doubt about the Company's ability to continue as a going concern. The Company is within one year of its mandatory liquidation date (October 2026) and has limited operating cash ($876,477) outside the Trust Account to fund operations and search for a target.
• Liquidity: Liquidity is currently supported by proceeds held outside the Trust Account. The Sponsor or affiliates may provide "Working Capital Loans" up to $1.5 million, which may be convertible into warrants, but are not obligated to do so.
• Redemption Rights: Public shareholders may redeem their shares for a pro-rata portion of the Trust Account (approx. $10.23 per share as of Sep 30, 2025) upon the consummation of a Business Combination or liquidation.
• Deferred Fees: $9 million in deferred underwriting commissions are payable only upon the successful completion of a Business Combination.
• Risks: Risks include the inability to complete a Business Combination within the required timeframe, potential delisting from Nasdaq, and market volatility affecting the valuation of warrant liabilities.

Investor Verification Checklist

• Trust Account Yield: Verify the current interest rate environment and its impact on the Trust Account balance, which determines the redemption value per share.
• Warrant Liability Valuation: Review the assumptions (volatility, risk-free rate) used to value the NMSI warrants, as changes here create significant non-cash volatility in net income.
• Working Capital Sufficiency: Assess whether the $876,477 in operating cash is sufficient to fund the search for a target through the mandatory liquidation deadline without additional sponsor loans.
• Sponsor Commitment: Confirm the New Sponsor's financial capacity to provide working capital loans if required to extend the search period.
• Redemption Risk: Evaluate the likelihood of significant shareholder redemptions, which would reduce the funds available for a potential acquisition.